Project overview

Quick facts

• First West Coast LNG receipt facility.
• Between Rosarito and Ensenada in northwestern Mexico.
• Upon project completion, 1.0 billion cubic feet per day (Bcf/d) initial sendout capacity, with room for expansion.
• Owned 100 percent by Sempra Energy; represents a capital investment of about US$1 billion in Baja California (including pipelines).
• Two full-containment storage tanks (2 x 160,000 cubic meters); one ship berth with separate breakwater.
• Fully permitted; capacity fully contracted.
• Construction began in January 2005.
• Commercial operation scheduled to begin early 2008.

Energía Costa Azul is an LNG receipt terminal on the coast of Baja California, Mexico. It will begin operation in 2008 and will process 1 Bcf/d, with the possibility of expansion. On about 400 acres of land far removed from any residential areas, the site is 15 miles north of Ensenada in a remote, undeveloped area that is suitable for infrastructure, including energy storage.

We have worked with public officials, community leaders, local biologists and naturalists in Baja California to produce a site plan that improves the region's infrastructure while safeguarding the environment.

Because Baja California's gas infrastructure is isolated from the rest of Mexico's energy supply, it has relied on U.S. gas supplies that are delivered through the transmission systems of the Southwestern U.S. With the Energía Costa Azul LNG receipt terminal, the Mexico gas market will move to the head of the line for access to new, imported gas supplies. This will empower the region with a competitive source of supply.

New gas supply is needed in Mexico because major growth in industrial and commercial businesses, as well as new power plants to serve the growing population, will create an immediate need for 500 million cubic feet of gas per day (MMCFD) on peak days, half the capacity of the receipt terminal.

The remaining capacity of 500 MMCFD can become an alternative source of supply for California and Southwestern U.S. gas markets.

On Oct. 12, 2004, Sempra LNG announced the signing of a 20-year sales-and-purchase agreement with BP and its Tangguh LNG partners for 500 million cubic feet of natural gas a day. This agreement will cover half the capacity of the Energía Costa Azul receipt terminal. A few days later, Sempra LNG announced the signing of another 20-year agreement that provides Shell with the remaining half of the terminal's initial capacity.

On Jan. 3, 2005, Sempra LNG announced the award of engineering, construction and procurement contracts for Energía Costa Azul. Techint SA de CV of Mexico; Black & Veatch of Kansas City, Mo.; Mitsubishi Heavy Industries of Tokyo; and Vinci Construction Grands Projects of France (BMVT) were awarded the about $500 million primary engineering, construction and procurement contract, while a joint venture involving the Costain Group PLC of London and China Harbour, one of China's largest construction groups, won the construction contract for the project's $170 million breakwater.

On Jan. 11, 2005, Sempra LNG was awarded a 15-year natural gas supply contract by Mexico's state-owned electrical utility, Comisíon Federal de Electricidad (CFE). The contract is estimated at $1.4 billion over its life and supports the CFE's future energy requirements in northern Baja California, including the Presidente Juarez power plant in Rosarito. Starting in 2008 and running through 2022, the agreement provides CFE with an average of about 130 million cubic feet per day (MMcf/d) of natural gas. The long-term CFE sales contract will consume more than one quarter of the 500 MMcf/d Sempra LNG is procuring from Indonesia.

On Friday, July 28, 2006, workers raised the roof atop the second of the project’s two LNG storage tanks.

Construction on the $875 million project is over 96 percent complete and on schedule to go into operation early 2008. 

Link to the Energía Costa Azul website